Monday, January 27, 2014

David Cunliffe gave his "state of the nation" speech today, opening election year with an anti-child poverty package consisting of broad (but still targeted) payments to new parents, more free ECE, an extension of paid parental leave, and free antenatal classes. The core of the package is a "best start" payment - basically a baby bonus - described as " universal for all families earning under $150,000 per year" (i.e. not universal at all). The high threshold is already coming under attack from National and its proxies, and it seems to have given them the worst of both worlds: all the bad PR of universality with none of the benefits. And its probably questionable whether the cost of administering that threshold (which apparently excludes less than 5% of parents) is worth the ~$9 million a year it would save. In the second and third year, payments are targeted, falling off from a household income of $50,000 and ending somewhere between $80 and $100 thousand depending on the number of children. The median gross household income was about $75,000 in 2011, so basicly these payments are targeted at the bottom 50%.

The second strand of the policy is an extension of 20 hours free ECE to 25 hours. What's surprising is how cheap this is - a mere $60 million a year. At that price, you really have to wonder why they didn't just go all the way and make the entire system free.

The extension of paid parental leave isn't a surprise, and it looks like it may happen anyway.

The ante-natal classes and healthcare stuff is pocket change. Welcome, worth doing, and will make a difference. But not a huge policy.

The policies are all costed, and easily affordable within the $1.5 billion Labour has given itself by ditching its GST policies. And it doesn't look like a terrible trade so far. I would have preferred a more universal scheme (because they build social solidarity - something the NeoLiberals want to destroy), but it can be built into one, and we can always hope Labour will salami that as they did on healthcare. Overall, its a good start.